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Hey fools. Can someone explain to me whether TIAA-CREF's SRA is truly an annuity? My understanding is that the SRA allows an investment (in a choice of funds including an index fund), but how does that differ from choosing an index fund within an IRA? Is this a good option for investing beyond an IRA?
Thanks for your advice.
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I'm puzzled by that myself. Why don't you call and ask them?

But whether it's an annuity or not, the only things that concern you are:
1. Getting money in
2. Getting money out
3. Returns and fees while it's in there

If all three are acceptable, it doesn't matter whether the underlying asset is an annuity or a mutual fund.
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Most TIAA-CREF funds are annuities, but they have now added mutual funds as well. Until a couple of years ago, TIAA-CREF was a retirement program only for school teachers and college faculty and staff. They just recently opened their products up to anyone. That's when they added mutual funds.

An annuity is simply an investment instrument owned by an insurance company. How they invest the money inside the annuity is up to the company. TIAA-CREF is simply telling you how they invest the money in that particular annuity. Their fees are very comparable to most mutual fund companies and in many cases the fees are less.

I have money invested in TIAA-CREF and I have been very pleased with how they operate and the returns on their annuities. The CREF annuities are easy to transfer money into and out of. TIAA, however, takes ten years to transfer money out of. Seriouly, I started three years ago transfering money from TIAA over to CREF annuities.

Hope this helps.
Tony
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Hey fools. Can someone explain to me whether TIAA-CREF's SRA is truly an annuity? My understanding is that the SRA allows an investment (in a choice of funds including an index fund), but how does that differ from choosing an index fund within an IRA? Is this a good option for investing beyond an IRA?

An SRA through TIAA-CREF is "truly" an annuity. However, TIAA-CREF's annuities lack the drawbacks that make so many other annuities unappealing (TIAA-CREF's expense ratios are low, and there are no surrender charges).

There is essentially no difference between investing in an index fund in TIAA-CREF or in an IRA. When you retire, you have the option of taking your money from TIAA-CREF as an annuity, but you are not required to. The main difference between an SRA and an IRA is in investment options: you have more flexibility (i.e. individual stocks) in an IRA. But if you're going to invest in an index fund either way, then the SRA may be a better way to go because contribution limits are higher for 403b plans than for IRAs.

One little-known option for SRAs is that you could transfer them to a 403b7 account with a mutual fund, i.e. Vanguard. You do not have to keep them in TIAA-CREF. However, the CREF funds have been good performers so unless you have some special interest that isn't covered by CREF, I don't see any reason to transfer out.
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